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How are the funds available to the participants during the plan year?

Per IRS regulations, the entire health FSA election is available on the first day of eligibility in the plan year. So if a participant elects $2,550, (and they are eligible on January 1), they have access to that full amount of their election even though they haven't funded the account. The same rules apply to a Limited Purpose FSA. The Dependent Care benefit is not required to be pre-funded. Only actual contributions into the Dependent Care benefit will be available for use.

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